12 Oct 2020 Featured in: Americas Weekly - Issue 40

Research Highlights - Week 41

US refinery intake may need to underperform a while longer to deal with the current overhang in distillate stocks (see Americas Weekly – Issue 40).

  • Distillate production’s resilience in the immediate aftermath of coronavirus-related lockdowns has proved its undoing, with bloated inventories struggling to draw significantly, although implied demand has seen some improvement.
  • Gasoline production on the other hand lagged improvements in end-user demand on average over summer, laying the groundwork for a comparatively supportive inventory picture as we move into Q4.
  • With distillate stocks still markedly above historical-average levels, however, we may need to see crude intake trending closer to recent post-hurricane lows in order to cap production well below end-user demand until stocks have managed a few weeks of sizeable draws.